I call the meeting to order. I'm Shannon Stubbs, serving as chair today. Good afternoon.

I apologize to our witnesses for the late start.

As everyone knows, we will have three witnesses today over the course of the meeting: Patrick Bateman from the Canadian Solar Industries Association; Bryson Robertson from the Institute of Integrated Energy Systems at the University of Victoria; and via video conference, Malcolm Metcalfe from Enbala Power Networks.

Each of you will have seven minutes to make opening statements, and then we'll move into questioning. Members, as we go around the table, will have a round of seven minutes for questions and then, if we get time, a second round of five minutes.

Madam vice-chair, ladies and gentlemen members of the committee, good afternoon.

I would first like to thank you for having invited me to testify here today, and also for giving me this opportunity to practise my French. I would also like to thank the clerk for his very good work.

My name is Patrick Bateman and I am the director of policy and market development of the Canadian Solar Industries Association, or CanSIA. I have been working in the area of renewable energy for 10 years now. I devoted a large part of my career to working with companies in the solar energy area in order to make solar energy production more common and more generalized in all of Canada's provinces and territories.

As stated in the policy objectives in the pan-Canadian framework on clean growth and climate change, and as demonstrated in several analyses, including Canada's mid-century long-term strategy, meeting Canada's climate action and clean growth targets and objectives is reliant on maximizing the efficiency of our energy use and minimizing the greenhouse gas emissions intensity of the energy that we use.

Non-emitting electricity generation, including that from the renewable energy sources—solar, wind, marine, and hydro—currently meets approximately 80% of Canada's annual electricity needs. Canada's abundance of existing non-emitting electricity assets and untapped renewable and solar energy potential is Canada's single largest competitive advantage in the challenge of deep decarbonization of our economy.

Canada is committed to a target of 90% of our electricity production being from non-emitting energy sources by 2030. Not only will this ambitious outcome result in material emissions reductions from the electricity sector; it will also provide an emissions-free, reliable, and affordable option for fuel switching in the transportation, buildings, and industrial sectors. This is also termed electrification.

There is no viable alternative for Canada to meet our international obligations under the Paris agreement other than to rapidly increase the proportion of non-emitting electricity in our supply mix and to pursue significant levels of end use electrification.

Solar electricity generation is a supply-mix option that can contribute to this targeted outcome. Many studies are being continually published that document the rapidly declining costs of solar electricity generation. One such study, from Lazard, shows that the cost of solar electricity has declined by 85% since 2009. Many studies show that solar energy will be the lowest-cost option for new electricity generation throughout the world by the mid-2020s. This will also be the case for Canada.

For instance, the CEO of Hydro-Québec, Éric Martel, was recently quoted in Le Devoir . This is what was said:

Hydro-Québec believes that, as of 2024, the cost of locally produced solar energy will rival that of hydroelectricity distributed on its network .

The narrative about solar electricity has quickly been transformed from when it will be cost-competitive to how much cheap solar electricity we can reliably integrate onto our grid. Jurisdictions around the world are demonstrating that high penetrations of variable generation, such as solar, can be reliably integrated. For example, during the first half of 2017, more than 10% of the United States' electricity was met with wind and solar energy for the first time in history. During this time, several states actually met 20% to 40% of their monthly electricity demand from wind and solar. World leaders, including Germany and Italy, currently meet between 7% and 9% of their annual electricity needs from solar energy.

With respect to interties, interties that create larger areas across which to balance variable supply and demand are one tool in the tool box for the system operators in these regions to manage increasing penetrations of variable energy resources. As such, CanSIA believes that strategic investment by the federal government in transmission infrastructure that provides greater linkages between the electricity systems of two or more provinces can support our national climate action and clean growth policy objectives. CanSIA recommends that a key basis on which the decision to invest is made is that the investment will result in significant greenhouse gas emissions reductions and contribution toward our national 90% non-emitting electricity target.

In addition, we would recommend that due diligence on the cost-effectiveness of individual projects take into account current and realistic future pricing for solar electricity and also for storage technologies. There are many examples of long-term investment decisions being justified on outdated pricing for alternative options. Solar plus storage can, and will, cost-effectively fulfill some of the roles that some interties would play in future. Any investment decision should be made with a full and accurate understanding of the various available options.

Finally, it is also CanSIA's view that the electricity system of the future is one that places electricity consumers at the forefront with a wider array of new, clean, smart, and distributed technologies available to them. CanSIA believes that investment in new interties should ensure that Canadian electricity consumers are provided with more options to manage, generate, and store their own electricity as well.

This concludes my remarks.

Once again, I thank you for having given me this opportunity to speak before the committee.

Thank you very much for this opportunity to present, as well as to Mr. Bateman for presenting a lot of the facts that I was going to present. Mine will be a little shorter, allowing more times for questions.

As a bit of background, I'm an adjunct professor at the University of Victoria's institute for integrated energy systems. I'm here wearing two hats today: one with regard to the 2060 project, which is funded by the Pacific Institute for Climate Solutions, looking at deep decarbonization pathways for Canada's energy system, as well as on behalf of Marine Renewables Canada and the marine renewables industry.

The 2060 project looks at the intersection of technology, policy, economics, environment, and society in developing decarbonization pathways for Canada's electrical sector. At this stage, we focus primarily on British Columbia and Alberta, and I'll give some reasoning as to why that is.

I think it is important to state up front that that project is technology neutral. We don't pick winners or losers, we simply place all the technologies available to us on the table. We allow the system to optimize the least-cost, least-risk solution for Canada in meeting our greenhouse gas reduction targets.

On the marine renewables side, I also run a project looking at wave energy for British Columbia, looking at developing and understanding the opportunities, hurdles, and value proposition for developing marine renewables for British Columbia. By connection to Marine Renewables Canada, we look at tidal on the east coast.

I'm going to try to answer the questions from those two perspectives. If people get confused, I'll try to elucidate which perspective I'm talking from.

Looking at the intertie, as Mr. Bateman pointed out well, Canada's mid-century, long-term, low-greenhouse gas development strategy states that Canada needs to reduce greenhouse gas emissions by 80% by 2050. This is transformational change. This isn't something that is incremental. There is a significant change that needs to happen.

The Canadian system is well positioned to be a global leader in this space. Currently, 80% of our generation comes from non-emitting resources. Provinces like British Columbia, Manitoba, and Quebec are well positioned to be able to do this already. The other provinces are just not naturally endowed with this competitive advantage.

Times are changing, though. If we look at what is happening in Alberta and around the world, it's being driven by both policy and economic drivers. We are seeing Alberta put into account their 30% renewables by 2030 and push coal out of the system. As well, I don't think anyone would have suggested or predicted the cost changes that we're seeing in wind and solar these days.

Connectivity is key to this reliability question, being able to take complete advantage of our natural resources that we have in the country. There is a huge distribution of our rural renewable energy resources across the country. We have hydro in British Columbia, wave in British Columbia, solar and wind in Alberta, and tidal on the east coast. Interties allow us to start to connect these. It allows us to start to look at peak demand diversity and how to mitigate those and reduce costs to the general consumer.

I think it's important to note, before I get into an example on how we're showing the value of interties, that there are a lot of zero-carbon energy resources that are economical right now. It's important for us to think beyond that and look at zero-carbon flexible capacity. What is going to be there to manage the variability in the energy resources that we have? We have limited economically viable options right now in that regard.

The 2060 project will look at deep decarbonization for British Columbia and Alberta. We don't look at it from a provincial perspective, we look at it from a regional perspective. If the two provinces were able to create a market that worked for both and come to political agreement on a whole slew of different things, what would the benefit be?

Under a climate change-inclusive vision for the future, we can see that seasonally there are huge advantages. As Alberta builds out its wind resources, they're going to have overgeneration in the winter. They are going to generate too much renewable power in the winter, which they are either going to have to curtail or they're going to have to export somewhere else.

Concurrently, British Columbia's hydro resources will no longer be generating at the same level. They will be slowed up, so we will be able to absorb that. In the summertime, British Columbia is going to continue to be affected by the freshet and have low cost of power. We'll be able to export that into Alberta where their wind resources aren't working. There is huge complementarity in the seasonal and temporal aspects of these resources, and intertie unlocks that potential.

What does this do for our greenhouse gas emissions? If we stayed with the situation as normal, we suspect British Columbia would stay at about 95% renewable. Alberta will reach its 30% goal. However, if we intertie them, we probably can get to about 92% or 93% renewable. There is significant investment. The intertie needs to grow eight to 10 times its current capacity, but I think just showing that there is a value proposition there is important.

On the marine energy side, to provide that, one of the greatest competitive advantages of marine energy is its location. Our current electrical system is generally fairly centralized to where our resources are, and a lot of our coastal communities don't have a lot of generation. They're connected by somewhat unreliable transmission lines to the coast. No disrespect to the utility. They work hard and they do a fantastic job, but there is this complementarity among our variable renewable resources, and there's a huge advantage in our starting to unlock all of those tools, all those resources that are in our tool box as a country.

We need spatial and temporal diversity in our resources, so we're looking at wind and solar. I don't think there's much debate that wind and solar will dominate in the future, but in the long-term predictions, once we start to see incremental value to incremental gains and capacity, we start to see value build out in diversifying beyond those two.

In conclusion, including marine renewables in our generation resources will provide us with a more resilient and independent system and allow us to offset additional transmission capacity to provide generation resources on our coastlines.

It's a real pleasure to have been invited to speak to you today. This topic is of critical importance to us all, and I'm happy to assist in whatever way that I can.

I started a career in energy almost 60 years ago, when I worked for a utility in B.C. As a student I earned enough working in the summer months to pay my way through university. I started at the bottom, but by the time I was finished my master's degree, I'd worked as a load dispatcher and trained some operators on how to operate a power plant.

I've worked for a number of energy companies in Canada. After retiring, I started a new company called Enbala Power Networks. Initially there were three of us. Our intent was to implement cost-effective solutions to reduce emissions in hotels in Whistler. We actually were successful. We reduced the greenhouse gas footprint for the village by 10%. This earned me the honour of carrying the Olympic torch.

I have to say, I'm happy to tell you that the University of Victoria, Bryson's team in Victoria, has been a major source of employees for us. I think almost all the new engineers that we've hired have come from UVic. I'm heading into town in a few days to spend the day with one of our new people.

Canada is really very fortunate. We have about more than 80% of our electrical generation in renewables. That may change because, as we shift from fossil fuels to electrical use, for example, use of electric cars, then I expect that there's going to be a lot of pressure on that number. We're going to have to take some steps.

I'm taking a slightly different approach on this because I see Canada as being divided into three significant areas. B.C. has huge hydro storage and hydro generation, Manitoba has large hydro storage and large generation, and Quebec has large hydro storage. In between, these provinces need very badly to access the storage that's available. The idea of putting tie-lines in between the provinces that lie between B.C., Manitoba, and Quebec would be very valuable to them to allow them to improve their carbon emissions.

The problem of actually integrating solar and wind is not quite as easy as a lot of people seem to want to think it is. I'm doing a Ph.D. right now—even at my advanced age—on a novel method of integrating solar and wind into the grid. One of the things that's interesting is that we found that the grid as it exists, because generation follows the load, is only used to 50% of its capacity. If we turn the grid upside down and manage from the bottom, manage loads, manage storage locally, manage distribution, distributed generation, and distributed storage, we can actually deliver much more power through the grid.

There's been a lot of effort put into the system to minimize and optimize the uses of electricity. For example, for electric lights and electric motors, which are the two largest loads on the electric system, the efficiency has dramatically changed in recent years.

In fact, there are opportunities now, I believe, to optimize the source because in actual fact we have line losses of about 10%. But when you run generators up and down as we're currently doing to follow the load every day, the average efficiency is down well below 90% for hydro generation, and below that for some of the others. In fact, some of the fossil fuel generation runs at about 30% efficiency. There's a huge opportunity to work together to integrate the storage that some of the utilities have, specifically B.C., Manitoba, and Quebec, with Canadian provinces to gain.

Just to put this in perspective, B.C. Hydro over recent years has been selling power to California. We actually have not been selling energy. We sell power during the afternoon and buy it back at night because they're unable to shut down some of their plants. We've made as much as $3 billion on buying and selling. Yet the actual amount of energy has been negative. We've actually imported energy, yet still made $3 billion.

That money could actually be used in Canada by strategic interties between B.C. and Alberta, and perhaps between Manitoba, Alberta, and Ontario.

Manitoba, I know from discussions with them, has done very well by supporting wind energy in the U.S. Quebec, we all know, has done extremely well doing the same thing in New York that BC Hydro did in California.

I believe, then, that there is a real value, but there's a need for a strong plan that will look at the whole system.

To carry this a step further, we're having some degree of difficulty because the utilities are all sitting.... I would argue that they have done a very good job of supplying reliable power, but they are out to make their share of the money. They are regulated as to what they can make, and they will collect that amount of money regardless of how much energy they sell.

On the other hand, we're seeing people now putting in solar systems all over the U.S., installing them to reduce their costs.

You have, then, two groups trying to optimize the same thing but coming to very different results. The net result is not a very happy one, in that the U.S. utilities appear now to be looking to charge a demand charge for electricity that will actually damage the cost-effectiveness of a lot of the solar energy.

I believe that if we were to work as a unit and have some kind of central planning or some sort of central operation that planned for both sides, we could maximize the amount of renewable energy we get on the system and run very efficiently.

It's going to take all we can get. If you look at the amount of energy that's used.... We did a lot of audits in B.C. in buildings and found that two-thirds of the energy came in through the gas pipe and one-third came in through the electricity wires. If you're going to eliminate the fossil fuel side of things and attach the transportation industry at the same time, you're going to find that the need will be very dramatically shifted towards electricity. We're going to have to work very closely together.

With respect to the jurisdictions that already have solar electricity generation, the penetration currently is still very low. At this point, in many cases the solar electricity is being consumed at a local level and isn't finding its way to the transmission system. In those instances, transmission infrastructure is quite often not needed either within the region or inter-regionally.

To build on something that Mr. Robertson said, when you begin to have higher penetrations of wind and solar and other resources—for example, in Alberta—the wind resource is very strong in the winter and at night, whereas the solar resource is excellent but is also the opposite: it's very strong during the summer and during the day. When you have very high penetrations of wind and solar, the majority of the time you have just the right amount, but when you have too much of one or the other, it helps to share with your neighbours and to balance between the two.

Can you speak to the competitiveness of solar and to the way it can help with the integration of renewable energy sources? Right now, whenever people talk about solar the image in people's brains is just that from solar you get electricity. Actually, though, there are other ways of using solar power. For example, some people use solar energy to melt salt, and they use the molten salt to heat other things—water, or whatever—to provide heat sources.

With respect to cost, as I mentioned for utility scale solar, we've seen price declines since 2009 of about 85%. It's very hard to keep track of how quickly these costs are coming down. It's the same for laptop computers or smart phones, it's just been driven down further and further.

The advantage of solar electricity generation is that all of the capital costs are incurred up front, so the cost of electricity generation has close to a zero marginal cost and you know exactly what your cost is going to be for 20 or 30 years. In many cases, you're not subject to inflation risks. You have no exposure to what can be at times volatile energy markets. Also, since it's not emitting, you have no exposure to carbon risks either.

We're still seeing something of a delta between new solar generation and other forms today, but when you take a life cycle approach then in many cases, solar is less expensive than other forms of new generation in Canada today. In years to come, we'll see solar potentially reaching lower costs than existing assets as well. I draw attention to Mr. Martel's comment from Hydro-Québec that they expect solar to be cost-competitive with existing hydro assets by 2024. In electricity generation asset lifetimes, that's a very short period of time.

I took quite a long time with your first question, so I'll be quick with my second one. Photovoltaics have been the dominant electricity source. The application that you mentioned with molten salts uses a variety of different forms of mirrors to concentrate solar energy. Typically, to date at least, those technologies have been most suitable for jurisdictions that have a direct normal radiance of more than five kilowatt hours per metre squared per day. In Medicine Hat, there is the only example of a similar kind of technology. We're at very early stages. I think that there's probably limited applications for things like that in the immediate near term. In the future, it may be possible, but I think for the time being that photovoltaics will be the dominant technology.

I couldn't speak directly to the interties, but what I would say is that solar electricity generation creates more jobs than any other electricity source by dollar invested or by megawatt hour generated. Specifically, with the relation to the interties, I don't have a comment at this time.

I would actually take a slight issue with the value because California, as an example right now, is looking at an intertie, or at a ramp rate of 30,000 megawatts over a few hours, as the solar comes on and goes off in the morning and evening. Therefore, what they're needing to do is to ramp up generation in the evening, as the solar goes down, and ramp it down in the morning, as the solar comes up. They do not have the generation capacity to do that, so they're looking to B.C. to try and offer them the ramping capability so that they can do that.

By the way, you notice that Hydro-Québec is saying that this solar will offer a large part. It can do that because their utility is capable of very fast ramping, so that between night and day, or when the wind starts to blow and stops, they can ramp their hydro up very quickly and ramp it down equally quickly. They can provide the rate of change that's needed in order to integrate the two together. That's going to be a problem.

It's great to be here. This is a great conversation to have, and I think something that is quite supported. The interties across provinces I think is a fantastic thing we need to be moving towards.

Mr. Bateman, thank you for joining us. Thank you, all, for joining.

My questions, and being from Ontario, you can probably see where I'm going with this.... At our last meeting, the Canadian Wind Energy Association was here. Obviously, you're very familiar with what's going on in Ontario. An article from 2015 says the Ontario Auditor General says those in Ontario paid $37 billion more over the past eight years because of hydro. I do realize there were a variety of reasons for that, so I'm not putting it all on the industry. You said something about jobs just a few minutes ago. Can you repeat that for me, just so I have it clear?